Rupee gains to around 94.96 as RBI tightens forex rules and eases spot dollar demand

Mumbai: The rupee strengthened 82 paise to 94.96 against the US dollar in early trading on October 13, extending its recovery after Reserve Bank of India measures aimed at reducing spot dollar demand and limiting speculative currency positions.The domestic currency opened at 95.53 before advancing to 94.96. Monday’s session had seen a 93-paise appreciation to 95.78, its biggest single-day gain in more than six months.RBI Measures Support Rupee RecoveryForex traders attributed the improvement to a dedicated dollar window for oil marketing companies through designated banks and higher costs for certain foreign exchange hedging transactions.India 10-Year Bond Yield Surges To 7.35% As RBI's ₹25,000 Crore OMO Sale, Rate Hike Rattle Markets These steps are expected to shift dollar demand away from the spot market and discourage speculative bets against the rupee.CR Forex Advisors Managing Director Amit Pabari projected that the dollar-rupee pair could move towards 95.00–94.80 in the near term, supported by RBI’s interventions.Forex Derivative Rules TightenedThe central bank announced stricter forex derivative rules on Saturday and introduced a 20 per cent reserve requirement for specified dollar-purchase hedging transactions exceeding $2 million.Authorised dealers were also instructed not to permit the rebooking of cancelled foreign exchange derivative contracts involving the rupee, whether deliverable or non-deliverable.The measures seek to curb excessive positions while improving discipline in the foreign exchange market.Dollar And Crude EaseThe dollar index slipped 0.15 per cent to 102.43. Brent crude futures declined 1.11 per cent to $105.47 a barrel, although oil remained elevated.Rupee Surges 96 Paise Against US Dollar, Here's What Triggered Its Biggest One-Day Rally In Six Months? Domestic equities traded higher. The Sensex stood at 72,224.15, while the Nifty gained 93.40 points to 22,458.50.Foreign institutional investors sold equities worth ₹1,708.48 crore on Monday, according to exchange data.September Inflation Rises To 5.54%Retail inflation accelerated to 5.54 per cent in September, driven by higher onion and other food prices, government figures showed.The reading increased from August’s 4.83 per cent, according to the National Statistics Office, while remaining within RBI’s tolerance band.Higher inflation and foreign outflows remained part of the backdrop.

In a significant turnaround, the Rupee gained ground against the US dollar, settling at 94.96 as a result of strategic interventions by the Reserve Bank of India. These measures aimed at reducing excessive demand for dollars positively influenced the forex market, contributing to a decline in the dollar index and modestly lower oil prices.

The Indian currency opened at 95.17 per US Dollar against the previous close of 95.77. Currently, it is trading at 95.27.

RBI measures to reduce dollar demand and curb excessive positions in the forex market lift rupee

At the interbank foreign exchange market, the rupee opened at 95.61 against the U.S. dollar; in intraday trade, the rupee touched a high of 95.57 and a low of 95.96 against the greenback

At the interbank foreign exchange market, the rupee opened at 95.61 against the US dollar; in intraday trade, the rupee touched a high of 95.57 and a low of 95.96 against the greenback